Dividend Yield Investor!

Saturday, April 4, 2020

Vanguard

High Yield Corporate Bond Fund

VWEHX

Current Yield 8.06%

*********************

Vanguard

Energy Fund

VGENX

Current Yield 6.42%

DYI: Two different sectors have been beaten down significantly showing excellent future returns for the long term investor. They are Vanguard’s High Yield Corporate Bond Fund symbol VWEHX and Vanguard’s Energy Fund symbol VGENX. The High yield fund current yield is [as of 4/3/20] 8.06% with an effective yield to maturity of 4 years in length. Compared to 5 year T-notes at 0.39% you now have excellent interest rate coverage for your risk. The energy fund’s dividend yield is now [as of 4/3/20] 6.42%. Obviously if oil prices stay low for an extended time such as a year or more there will be dividend reductions. Be as that may be this sector has been smashed making for a great buying opportunity at depressed prices.

Till Next Time

DYI

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Estimated 10yr return on Stocks

Using 5.4% as the historical growth rate of dividends and 4.0% as the ending yield.

Starting Yield*---------return**
1.0%-----------------------(-5.7%)
1.5%-----------------------(-1.7%)
2.0%------------------------1.3%
2.5%------------------------3.8%

3.0%------------------------5.9%
3.5%------------------------7.8%
4.0%------------------------9.4%
4.5%-----------------------10.9%

5.0%-----------------------12.3%
5.5%-----------------------13.6%
6.0%-----------------------14.8%
6.5%-----------------------15.9%

7.0%-----------------------17.0%
7.5%-----------------------18.0%
8.0%-----------------------19.0%

*Starting dividend yield of the S&P500-**10yr estimated average annual rate of return.

DISCLAIMER!

This blog site is not a registered financial advisor,broker or securities dealer and The Dividend Yield Investor is not responsible for what you do with your money.